The Impact of Internal Control Systems on Road Construction: a Case Study of the Ministry of Works and Infrastructure
CHAPTER 1
1. INTRODUCTION
1.1 Background To The Study
Control" and "organization" are terms indispensable in the framing of any understanding of modern business: as such they are terms which almost go before comprehension, as the givens of discourse. At the same time, they represent critical forms of modern knowledge-power. First, they are central to the structuring and running of the modern world in general (and not just the economic world): but also, as is increasingly recognized, they are vehicles that predispose us to see the world as a site where the power of expert knowledge must operate, even as they remake the world into such a site (Hoskin 2002).
In the processes of organization, planning and decision-making are a pre-condition and pre-requisite to effective and efficient performance in an organization. The quality of decision making in an organization depends on selecting proper goals and identifying means for achieving them. By separating the planning decision process from the decision control process is an important method of maintaining control over the members of the organization. Sequel to the aforementioned, by assigning planning decisions to one set of individuals and control decisions to another set of individuals, there is less chance that individual decisions will stray from those desired by the organization. Also by separating responsibilities for planning decisions and control decisions, the members of the organization monitor each other. Furthermore, separating planning decisions from control is a procedure used in internal control systems.
According to Kathleen M. Eisenhardt, “control can be achieved by minimizing the divergence of preferences among organizational members. That is, members cooperate in the achievement of organizational goals because the members understand and have internalized these goals”.
Internal control system is a system of checks and balances to verify that transactions are recorded and
1. INTRODUCTION
1.1 Background To The Study
Control" and "organization" are terms indispensable in the framing of any understanding of modern business: as such they are terms which almost go before comprehension, as the givens of discourse. At the same time, they represent critical forms of modern knowledge-power. First, they are central to the structuring and running of the modern world in general (and not just the economic world): but also, as is increasingly recognized, they are vehicles that predispose us to see the world as a site where the power of expert knowledge must operate, even as they remake the world into such a site (Hoskin 2002).
In the processes of organization, planning and decision-making are a pre-condition and pre-requisite to effective and efficient performance in an organization. The quality of decision making in an organization depends on selecting proper goals and identifying means for achieving them. By separating the planning decision process from the decision control process is an important method of maintaining control over the members of the organization. Sequel to the aforementioned, by assigning planning decisions to one set of individuals and control decisions to another set of individuals, there is less chance that individual decisions will stray from those desired by the organization. Also by separating responsibilities for planning decisions and control decisions, the members of the organization monitor each other. Furthermore, separating planning decisions from control is a procedure used in internal control systems.
According to Kathleen M. Eisenhardt, “control can be achieved by minimizing the divergence of preferences among organizational members. That is, members cooperate in the achievement of organizational goals because the members understand and have internalized these goals”.
Internal control system is a system of checks and balances to verify that transactions are recorded and
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